Music therapist Greg Hunford and musicians from Manchester Camerata leading a Music in Mind session in Crewe for elderly people with dementia Jack Burrow and his wife Vera who joined him in the session. Photograph: Christopher Thomond for the Guardian

Vera and Jack Burrows met as teenagers. "Childhood sweethearts," said Vera, brightly. "Then he dumped me when I was 17 and married someone else and we didn't see each other for 54 years. We were at a dance and he said: 'Is that you, Vera? I can recognise you from your thick ankles!'"

Despite this risky chat-up line, the pair were engaged within four months of their reunion – after Jack split up with three other lady friends. (Vera: "He used to buy them identical Christmas presents so he didn't get them mixed up.")

Five and a half years into their very happy marriage, Jack had a stroke while roasting a chicken, and has never returned home. Ever since he's been living in Station House care home in Crewe. Now 86, he's lost his speech and has increasing memory problems, but his bawdy sense of humour is very much intact.

Vera, a very glamorous 84 with turquoise eye shadow and a cloud of blond hair, had accompanied Jack to a special music session at the care home run by the music therapist Greg Hanford, director of MusAbility, and musicians from the Manchester Camerata chamber orchestra.

Overseen by Manchester University, it is part of a 10-week pilot project called Music in Mind, funded by Care UK, which runs 123 residential homes for elderly people. The aim is to find out if classical music can improve communication and interaction and reduce agitation for people in the UK living with dementia – estimated to number just over 800,000 and set to rise rapidly as the population ages.

The Crewe project is the fourth Music in Mind pilot. An assessment of the first three, by the Manchester-based thinktank New Economy, found that some participants no longer had to be medicated after taking part. Carers reported reduced agitation, better moods and improved posture; residents who had been slumped in their chairs raised their heads to take an active role.

"The power of music therapy enables, excites, enthuses, entertains," one musician told New Economy. "It's like opening the window of a stuffy room and allowing scented fresh air to waft in, lifting the spirits, changing the nature of the room."

Jack's session involved flautist Amina Hussain and French horn player Naomi Atherton, two of seven Camerata musicians trained in dementia awareness by the Alzheimer's Society, and a specialist nurse. Along with Hanford, two care workers and Jack (with Vera at his side), were two other residents: Pete, who has only one leg, and Taff, a tattooed Welshman who was keen on the tambourine.

Proceedings began with Hanford strumming his guitar and singing hello to each participant in turn. Jack clucked a return greeting, Pete looked straight ahead and Taff managed a delayed hello.

To an outsider, it initially felt slightly infantilising and all too reminiscent of a mother and baby singing group. But by the end of the half hour, the men were engaged in a rather moving performance, with Pete gently tapping out a rhythm on a cymbal, Taff shaking a rainstick and Jack on bells, all accompanied by world-class horn and flute.

"There is a crossover, or at least parallels, between working with very young children and people with dementia," said Hanford afterwards. "The 'hello' song is something I use with all different kinds of people. But maintaining dignity is at the heart of what we are doing."

"We have to make sure we don't baby anyone," said Hussain. "We have to remember these are people who have led full lives, with jobs, families. At first you do wonder if they think you're a right plonker, coming in and giving them brightly coloured instruments."

Gill Capewell, activities coordinator at Station House, said she initially worried the experience might be too daunting for residents. "I thought there would be a whole orchestra. I didn't realise how subtle it would be."

Atherton said she volunteered partly as a result of the death of her father, who developed Alzheimer's in his late 60s. The work brought big rewards for the most subtle developments, she said: "Like Pete today – when I put the ocean drum in front of him, his fingers were twitching." Another time, a resident with a very limited, fixed pattern of conversation finished her sentence in a way that showed she was engaged, she added.

"It can be like watching a flower open, at the risk of sounding dreadfully cheesy," said Hussain.

The musicians encourage people to live in the present, rather than the past, where many have often taken refuge. "Often in care homes they sing war songs, which may be very good but what if it triggers a bad memory? That's the past. We want them to be living in the moment," said Atherton.

Most other music therapy with this group tended to be performance-based, said Hanford. "The Liverpool Phil, for example, plays to patients. What's happening here is massively different because we're using music therapy as an intervention. It's like the difference between watching TV and using the internet. One is interactive."

But does it need professional musicians? Hanford said Manchester Camerata's involvement was a luxury, admitting such work primarily demanded patience and creativity rather than virtuoso ability. But Hussain said her expertise was important: "We are able to communicate with music very subtly, in a way that, for example, a grade eight player might not be able to. It could be that subtle difference that connects with someone."

• This article was amended on 1 July 2014 to clarify that Care UK is not a charity.